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If a firm can increase its total revenue by raising its price shouldn't it do so?
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A state government wants to increase the taxes on cigarettes to increase tax revenue This tax would only be effective in raising new tax revenues if the price elasticity of demand is?
elastic
Why is it not possible to conclude that OPEC total revenue would increase if it were to cut its production does the elasticity of non- supply have any influence on how the price of crude oil changes?
OPEC acts like a monopoly on crude oil. They can cut production and decrease the supply of oil, thus raising the price, but this does not necessarily increase revenue. As the price increases, the demand decreases. The percentage change in quantity demanded in response to a one percent change in price, while holding all other factors constant, is called price elasticity of demand. If the price elasticity of demand is high, then the demand will decrease significantly as the prices increase, and revenue may not increase.
Why do firms try to sell more products or to sell them at higher prices?
To increase revenue. Revenue = Price x Quantity sold. So if a firm sells more products and/or sells products at a higher price, revenue will increase.
If demand is elastic and price is lowered total revenue will?
increase
What would cause an increase in aggregate demand in the short run?
if decrease a price or if the expectation of raising a price
What does revenue increase?
It means generate more money. If a company wants to generate more revenue, they can do so by selling more products or selling the same amount at a higher price. When governments want to increase revenue - get more money - they usually do so by raising taxes or fees.
A state government wants to increase the taxes on cigarettes to increase tax revenue This tax would only be effective in raising new tax revenues if the price elasticity of demand is?
elastic
What does increase revenue mean?
It means generate more money. If a company wants to generate more revenue, they can do so by selling more products or selling the same amount at a higher price. When governments want to increase revenue - get more money - they usually do so by raising taxes or fees.
Why is it not possible to conclude that OPEC total revenue would increase if it were to cut its production does the elasticity of non- supply have any influence on how the price of crude oil changes?
OPEC acts like a monopoly on crude oil. They can cut production and decrease the supply of oil, thus raising the price, but this does not necessarily increase revenue. As the price increases, the demand decreases. The percentage change in quantity demanded in response to a one percent change in price, while holding all other factors constant, is called price elasticity of demand. If the price elasticity of demand is high, then the demand will decrease significantly as the prices increase, and revenue may not increase.
Why do firms try to sell more products or to sell them at higher prices?
To increase revenue. Revenue = Price x Quantity sold. So if a firm sells more products and/or sells products at a higher price, revenue will increase.
If demand is elastic and price is lowered total revenue will?
increase
What would cause an increase in aggregate demand in the short run?
if decrease a price or if the expectation of raising a price
When the price of a product rises and the total revenue of sellers increase?
You have an inelastic product.
Quadratic Functions Word Problem?
NO
How does a change in price on a linear demand curve affect total revenue?
on the linear demand curve, demand is elastic at price above the point of unitary elasticity so a price increase will decrease the total revenue.
A price cut will increase the revenue a firm receives if the demand for its product is?
Either elastic or inelastic
What is the pricing strategy that is needed when you are trying to maximize revenue when capacity is a factor?
increase price, decrease supply
